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U.S. Backs Down on Work Noise, Medical Devices

By ALICIA MUNDY, MELANIE TROTTMAN and JON KAMP

January 20, 2011

A day after President Barack Obama ordered the government to get rid of burdensome rules, two federal agencies backed down from proposals that had drawn jeers from businesses.

The Labor Department said it was withdrawing a proposal on noise in the workplace that could have forced manufacturers to install noise-reducing equipment. And the Food and Drug Administration retreated from plans to tighten rules on medical-device approvals, postponing a proposal that would have given the FDA power to order additional postmarket studies of devices.

“This is a very positive step forward,” said Bill Hawkins, chief executive of medical-devices heavyweight Medtronic Inc. “What’s come out in our judgment is more balanced.”

Diana Zuckerman, president of an advocacy group that had called for tighter medical-device regulation, said, “The FDA has backed down on important safety measures that would have saved lives … FDA decisions should not be based on a popularity contest, especially since lobbyists rig the results.”

During the first two years of the Obama administration, businesses often complained of what they described as an anticorporate bent among federal regulators.

This week, Mr. Obama tried to reset the relationship with his executive order calling for a review of hundreds of regulations. Wednesday’s moves by the FDA and Labor Department suggest the shift could deliver at least some of what corporations want, although many of the administration’s bigger regulatory efforts, including the new health law and plans for regulation of greenhouse gases, aren’t likely to be affected.

The $200 billion U.S. medical-devices sector was concerned about the impact of tighter approval rules, because it already faces pressure from the economic slowdown, slumping product prices, and tougher bargaining from hospitals and insurers. Some 3,000 devices are cleared annually through the simplified process called 510(k) that was affected by the FDA’s Wednesday announcement.

The industry’s lobbying group, the Advanced Medical Technology Association or AdvaMed, enlisted support on Capitol Hill to resist changes first proposed by the FDA last August in draft form.

“AdvaMed is pleased with FDA’s thoughtful analysis of comments by industry and its willingness to listen to views and concerns expressed by members of Congress” and industry, the association said.

The FDA’s announcement was previewed by President Obama in a Wall Street Journal opinion article Tuesday that said the medical-device changes would result in “getting innovative and life-saving products to market faster.”

That signaled a win to device makers. “It became obvious that industry would hear good news” with the publication of a presidential op-ed “urging smarter regulation,” said device-industry lawyer Jeffrey Shapiro of Hyman Phelps & McNamara PC.

FDA officials disputed suggestions that the agency bowed to pressure or politics.

“We are implementing 47 [changes], and that’s a lot,” said Jeffrey Shuren, director of the FDA device division, in an interview.

“We went out with truly bold proposals” last summer, Dr. Shuren said. But the agency found out in public responses that a number of the changes were too broad, or unnecessary because of existing rules, he said.

The 510(k) process is designed for devices that are similar to existing approved products. Critics, including some FDA officials, say it has been overused and sometimes the new devices getting clearance aren’t similar to the existing ones.

Among big medical-device companies, orthopedics firms such as Zimmer Holdings Inc., Stryker Corp. and Johnson & Johnson’s DePuy unit have the most riding on changes to the system, because these products are typically cleared through the shorter 510(k) reviews.

On the noise issue, the Labor Department’s Occupational Safety and Health Administration said it was responding in part to concerns raised by manufacturers and others, but said its move was unrelated to the Obama administration’s new regulatory strategy.

Currently, OSHA allows employers some wiggle room in how they go about providing workers protection against excessive noise. Employers can use steps such as giving workers earplugs.

With the backing of labor groups such as the AFL-CIO, the agency had proposed a reinterpretation of standards that would have raised the bar. Some manufacturers said they might have been forced to install costly noise-reducing equipment.

“It is clear … that addressing this problem requires much more public outreach,” said David Michaels, the assistant secretary of labor for occupational safety and health.

“There is sufficient evidence that hearing protection alone cannot prevent workers from suffering preventable hearing loss,” Mr. Michaels said in December. He also said that “easily applied” administrative or engineering controls could be used to protect workers.

Joe Trauger, vice president of human resources policy for the National Association of Manufacturers, praised Wednesday’s move. “We know now that this rule would have cost billions of dollars across the economy,” he said.

The AFL-CIO’s director of health and safety, Peg Seminario, said the impetus for the Labor Department’s move and Mr. Obama’s order was the same. “You’ve got the business community yelling fire,” she said. “At this point the Obama administration seems to be giving greater consideration to the claims of business.”

Write to Alicia Mundy at alicia.mundy@wsj.com, Melanie Trottman at melanie.trottman@wsj.com and Jon Kamp at jon.kamp@dowjones.com